10-01-2018 | EYE ON GREECE | EU

Wednesday, January 10, 2018

Big multi-bill brings in strike, auction changes

A multi-bill stretching to more than 400 pages was submitted to Parliament on Tuesday as the government seeks to tie up the third review, leaving just one more inspection by the institutions before the current bailout program ends in the summer.

“I refuse to engage in speculation over the name talks,” government spokesman Dimitris Tzanakopoulos told a press briefing on Tuesday when asked to respond to reports in Albanian media that Athens had reached an agreement on the long-standing name dispute with the Former Yugoslav Republic of Macedonia (FYROM).

The Athens bourse benchmark chalked up fresh gains during the closing auctions on Tuesday, climbing close to a five-month high on what was its 15th northbound day in the last 17 sessions, since December 13. While banks had a balanced day, buyers’ attention focused on mid- and small-caps.

It’s never a good a sign when someone — in this case European Commission President Jean-Claude Juncker — feels the need to publicize that a dinner “took place in a friendly atmosphere.” But that’s where the EU is at in its relationship with Poland. And regardless of how friendly it may have been, dinner between Juncker and Polish Prime Minister Mateusz Morawiecki (and his government reshuffle — more on that below) didn’t produce any tangible change to how Poland manages rule of law, report POLITICO’s Jan Cienski and Joanna Plucinska. Juncker’s dinner read out mentioned only that “they will meet again to pursue the discussion with a view to making progress by the end of February.” Ahead of the meal Juncker said he wasn’t “in the mood to make wild threats” about cutting EU funding to Poland.

European Council President Donald Tusk, a former Polish prime minister, was less friendly in a rare interview with Polish media. “Poland — and this is shocking also for Europe, and not only for pro-European Poles — has gone against everything that is important to the EU. And they did it deliberately,” he said.

Tusk slammed Jarosław Kaczyński, saying the PiS leader’s philosophy is ”power is above law, and not law above power. Where people or one man rules and not laws and regulations. Where the mandate received in elections is more important than the constitutional system, which imposes restrictions and rigors on the authorities … We do not have a dispute about what Europe should be like but with a dispute over whether Poland is to be a part of it.”

Polexit? “In Brussels, there is still a gigantic hope … that Poland will remain in the Union … all these [government] decisions from different areas — as the Białowieża forest, courts, the Constitutional Tribunal — have a common denomination. They are as if tailored to create this dreamed for conflict with the European Union,” Tusk said, adding that Poland’s ruling party conforms to the interests and expectation’s of Putin’s Russia “like twins.”

POLISH GOVERNMENT RESHUFFLE — KEY MINISTERS SACKED IN BID TO IMPROVE BRUSSELS RELATIONS: Prime Minister Mateusz Morawiecki removed both the foreign and defense ministers. The most contentious change involves Antoni Macierewicz, who lost his job at the defense ministry, replaced by Mariusz Błaszczak, the former interior minister and one of Kaczyński’s closest allies. Witold Waszczykowski is out as foreign minister, replaced by Jacek Czaputowicz, a much less controversial figure who had been a deputy foreign minister.

AROUND THE EU INSTITUTIONS

COMMISSION COLLEGE AGENDA TODAY: Budget Commissioner Günther Oettinger will provide a debrief on talks on the EU’s next long-term budget. European commissioners will discuss reform of the EU’s economic and monetary union, borders, Europe’s asylum system, the digital single market and the EU aspirations of Western Balkan countries.

Speaking of the Western Balkans: The U.K.’s House of Lords international relations committee said in a report released today that progress toward full democracy and commitment to the rule of law in the Western Balkans is wavering.

COUNCIL — ROMANIA TO PUSH FOR SCHENGEN MEMBERSHIP: After a meeting in The Hague with the Netherlands Foreign Minister Halbe Zijlstra, Romania’s Deputy Minister for European Affairs Victor Negrescu said he planned to organize a vote during the country’s current Council presidency on allowing Bucharest to join the Schengen area. “Romania’s accession is a right,” he said. “The message from the European Commission and many partner European countries is very clear.” The Netherlands has blocked Romania’s accession for years.

WEF — TRUMP DOES DAVOS: The World Economic Forum in Davos is exactly the sort of party Donald Trump likes to crash, write POLITICO’s John Harris and Ben White. “Lots of very rich people. Lots of media. Lots of fevered what-is-he-really-up-to speculation. At the psychological level, the appeal of Davos for Trump is obvious … some West Wing advisers were arguing that Davos would be the perfect venue for Trump to unleash an especially gassy stink bomb aimed at ideas — free trade deals, a more integrated global regulatory system, and all manner of liberal pieties cherished by global elites — he deplores.”

Where is Anthony Scaramucci? Trump’s short-lived communications chief is a Davos regular so ingrained in that milieu, he hosted an eponymous and sought-after wine-tasting night there for years. It would come as no surprise to find Scaramucci’s fingerprints on Trump’s Davos invitation.

DIGITAL POLITICS

SPOTIFY CEO CALLS ON EUROPE TO MOVE FASTER ON TECH, AND TECH TO MOVE FASTER ON EQUALITY: Daniel Ek told a POLITICO Playbook cocktail event Tuesday that the EU is doing better but not enough on tech. “I think the right things are being said and I believe the right things are being done, but we have to move faster,” he said. The EU should spend less energy crafting policies and regulations and focus on voluntary forums instead, Ek said, but he praised European Commissioner for Competition Margrethe Vestager’s approach to the tech industry. “We want there to be a fair marketplace and we want there to be more people to compete,” he said. “We think that will bring more innovation. She seems to be all for that.”

Ek argued the tech sector requires a fundamental overhaul of how it recruits and treats women within its ranks. That effort will take years to complete, he predicted: “There’s so much bullshit being used by people like me,” Ek said in reference to slow progress addressing the sector’s male dominance.

EU NATIONAL NEWS

OPINION — CATALONIA WON’T BE SILENCED, WRITES CARLES PUIGDEMONT: Ousted Catalan leader Carles Puigdemont (sacked by Madrid in October 2017) writes for POLITICO thatthe independence movement’s highest ever support in the region’s December 21 election is “a ratification of the results of the October 1 referendum, which was held in highly adverse conditions.”

ITALY — RIGHT-WING PARTIES STRUGGLE TO HOLD EURO LINE: Former Prime Minister Silvio Berlusconi and his right-wing coalition partner the Northern League appear to be struggling to maintain a consistent line on Italy’s membership of the eurozone. In a radio interview, Berlusconi said that Matteo Salvini, the League’s leader, had agreed that giving up the euro is a bad idea. “Salvini is no longer of the idea that we should leave the euro … He has understood that it would be technically impossible and unsustainable for our economy,” Berlusconi said. Not long after, the League’s economics spokesman Claudio Borghi appeared to disagree, saying: “One second after the League is in government it will begin all possible preparations to arrive at our monetary sovereignty. It’s a question of national security.”

CZECH REPUBLIC — BABIŠ SET TO LOSE CONFIDENCE VOTE THIS MORNING: Prime Minister Andrej Babiš said he expects to lose a vote of confidence by MPs in his government at 10 a.m. today. If Babiš fails, he will remain in a caretaker position and try again in a month with an updated set of ministers and policies.

Czechs vote separately in their presidential election Sunday: The incumbent Miloš Zeman leads handily in opinion polls but is not expected to achieve 50 percent of the vote, in which case he will face a much tighter second round runoff.

BELGIUM — GOVERNMENT BACK FROM BRINK OF COLLAPSE: Belgium’s government won’t fall in a scandal over the repatriation of Sudanese migrants — for now, at least, POLITICO’s Laurens Cerulus reports. Theo Francken, a junior minister in charge of asylum and migration, has been under pressure for organizing the deportation of Sudanese migrants in consultation with the Khartoum government, which faces widespread accusations of human rights abuses. Several of the deportees said Sudanese officials tortured them after they were repatriated.

GERMANY — HOW DO YOU SAY OBAMACARE IN GERMAN? Social Democrats have advocated for some form of citizens’ insurance for more than a decade, seeing it as key to their core values. Nowleaders are pushing for an agreement to overhaul the multi-billion euro health insurance system if they’re to enter another “grand coalition” with Angela Merkel’s conservatives, reports POLITICO’s Emily Schultheis.

DENMARK — RASMUSSEN SHELVES TAX CUT PLAN TO APPEASE FAR-RIGHT OPPOSITION: Lars Løkke Rasmussen, Denmark’s prime minister, announced Tuesday he would shelve plans to introduce a tax cut in order to maintain the support of the far-right Danish People’s Party. “I must accept that I am at the head of a minority government and that I have to get support for our policies,” he said at a press conference.

BREXIT 360°

BARNIER OUTLINES PHASE 2 EXPECTATIONS: Speaking at an event alongside Belgian Prime Minister Charles Michel, the EU’s chief Brexit negotiator largely reiterated the bloc’s red lines, including that U.K.-based banks would not have “passport” rights into the single market.

NORWAY PM WANTS UK CLOSE TO SINGLE MARKET: “Of course we hope for Brexit that connects the British … as close as possible to the single market,” Norwegian Prime Minister Erna Solberg told Reuters. “That will be the easiest way to work together in the future.”

A NEW EU CHARM OFFENSIVE FROM UK? It sounds more like a badly spun throwback to the Blair government than a Brexit plan. Nevertheless, U.K. Chancellor Philip Hammond and Brexit Secretary David Davis will be in Germany today and Thursday. According to a Eurasia Group note emailed to clients, the pair will “will make a public call to the EU27 to ‘put the negative rhetoric and emotion aside’ and engage constructively on Phase 2 transition and trade talks.” Ahead of the visit, Hammond and Davis said in a German newspaper article published today that the U.K. understands it cannot have “all the benefits” of the European single market without “all the obligations,” but it would “make no sense” to create barriers to trade.

Britain isn’t wrong to concentrate on Germany, which is taking a hard line on Brexit, but the ammunition for the offensive is woefully insufficient, in Playbook’s view. The EU is committed to ensuring Brexit leaves the U.K. worse off than it is today, as a matter of its own political survival, and that EU27 governments remain united. It will take more than occasional speeches for the U.K. to overcome that.

HOW TUESDAY’S CHARM OFFENSIVE WORKED: This one is from the catalogue of “The EU has the internet too.” Margaritis Schinas, the European Commission spokesperson, replied to questions about David Davis’ “no deal” Brexit letter to Theresa May: “We are surprised that the U.K. is surprised that we are preparing for a scenario announced by U.K. government itself.” Watch here.

The FT reports the trigger for Davis’ letter was EU regulators sending memos “to about 15 industries in November and December, ranging from drugmakers, seafarers and mineral water producers to hauliers and airlines that rely on U.K. operating licences. The documents call on companies to be ready for the U.K. to become ‘a third country’ on March 29, 2019, with no automatic right to operate in the single market. They also warn that operating licenses will automatically lapse after Brexit and that many groups may have to create EU entities for continuity of business.”

MORE BREXITEERS LOBBY BRUSSELS: Appearing in the European Parliament today for meetings and a press conference are former Minister Digby Jones; John Mills, Labour Party donor and chairman of Labour Leave; John Longworth, former director general of the British Chambers of Commerce; Steven Woolfe, independent MEP for North West England.

BEYOND EU

TURKEY — NORTH CYPRIOT ELECTION RESULTS IN COALITION GOVERNMENT: “The snap election was held against a backdrop of broad voter disaffection and allegations of abuse of power, misappropriation of public funds and anger over perceived subservience to Turkey,” writes Helena Smith.

US — STUDENT DEBT THE GOVERNMENT’S BIGGEST ASSET: Student debt, which is funded by the government, is approaching $1.5 trillion. It is by far the largest financial asset held on the federal government’s balance sheet.